What is the maximum potential loss for the trader, Finance Basics

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What is the maximum potential loss for the trader

Question: The stock price of BAC is currently $150 and a put option with strike price of $150 is $10. A trader goes long 300 shares of BAC stock and long 3 contracts of the put options with strike price of $150.

a. What is the maximum potential loss for the trader?

b. When the stock price is $161 on the expiration, what is the trader's net profit?

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Finance Basics: What is the maximum potential loss for the trader

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